Home  ›  Ilm Hub  ›  Answers  ›  What is an alter ego trust?
Ilm Hub

What is an alter ego trust?

A trust for someone 65 or older that holds assets outside the estate, avoiding probate and allowing a tax-deferred transfer during life.

This is legal information only. For advice on your own circumstances, speak to a lawyer.

A trust for someone 65 or older that holds assets outside the estate, avoiding probate and allowing a tax-deferred transfer during life.

The Canadian position

A trust for someone 65 or older that holds assets outside the estate, avoiding probate and allowing a tax-deferred transfer during life.

Provincial law governs administration, so confirm the position where the estate will actually be administered.

The Islamic position

The fixed shares apply to the net estate after funeral expenses, debts and any bequest capped at one third.

Where a Canadian mechanism has no classical counterpart, treat it as a contemporary question for a qualified scholar.

Researched — no classical split; present-day authorities differ

RRSPs, TFSAs, joint tenancy and beneficiary designations are all newer than the four schools, so this is not a madhhab difference and we have built no four-school table for it. What the schools do agree is the test: the tarikah is what the deceased owned at the moment of death, not how the asset moved afterwards. Applying that test to Canadian instruments is a present-day question, and named bodies reach opposite results — AMJA and Qatar’s Islamweb keep an earned plan in the estate; Singapore’s MUIS treats a nomination as a completed lifetime gift. No source on either side reasons from probate.

No school ruled on this instrument; named present-day bodies differ. Reviewed 2026-09-01. Full positions, evidence and sources — Assets that pass outside the estate — are they part of the tarikah?.

Related madhhab issue: When is a lifetime gift complete and beyond recall?.

Note

This is legal information only. For advice on your own circumstances, speak to a lawyer.

Citations & sources

Every factual claim on this page traces to a source below. Details change — check the original source before relying on any figure, fee or legal position. Anything under “further reading” is related material, not a source for what is stated here.

Canadian legislation & government
  1. T3 Trust Guide — Canada Revenue Agency
Further reading — Treadstone Law
  1. What is alter ego trust ontario — Treadstone Law
  2. Alter ego trust tax on death ontario — Treadstone Law
  3. Alter ego trust avoid probate ontario — Treadstone Law
  4. Alter ego trust eligibility ontario — Treadstone Law
  5. Wills & estates practice — Treadstone Law